Abstract:The Commodity Exchange Act exempts certain energy derivatives contracts from
regulation by the Commodity Futures Trading Commission (CFTC). These exemptions
are popularly known as the “Enron loophole.” Soaring energy prices have raised
concerns about whether the CFTC has enough information about these unregulated
markets to monitor energy trading in a comprehensive manner. The Farm Bill (P.L.
110-234) established a more stringent regulatory regime for electronic trading facilities
that offer contracts that play a significant role in setting energy prices. A number of
other bills in the 110th Congress would impose new reporting or regulatory requirements
on the bilateral energy swaps market, which was not addressed by the Farm Bill. This
report will be updated as legislative developments warrant. [read report]